(MONEY Magazine) – Stock and bond fund returns diverged in October for the first time since the August invasion of Kuwait. Continued signs of a creaky economy helped nudge stock funds slightly lower, but the same evidence caused interest rates to fall and bond funds to post their first monthly gain since August. Thanks to the drooping dollar and a rebound in Pacific markets, international stock funds emerged as the month's top-performing category.

CHART:

STOCK FUNDS Down 2.1% BOND FUNDS Up 0.3% AVERAGE MONEY FUND YIELD 7.7% TOP CATEGORY International: Up 8.8%